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Population Growth Is a Negative Economic Indicator

Everyone knows too much of a good thing can kill you. Even in moderation.

By Jim Russell


The skyline of Buffalo, New York, looking east from Lake Erie. (Photo: Nick Amoscato/Wikimedia Commons)

Metro Buffalo is dying. The latest Census Bureau estimates for 2010–15 reveal a small population decline. A drop of 279 people may seem insignificant. But few of the 100 largest metros lost residents after considering all demographic factors (natural increase, domestic migration, and immigration). Population loss is bad. Population growth is good.

Benchmarking Buffalo against its historical self, the numbers are relatively rosy. The bleeding has almost come to a stop. The community appears stable, with a surprise lurking beneath the drive-by headlines. A city notorious for blight and vacant homes struggles with a housing shortage. How can this be?

Uncritical assumptions dog the Rust Belt. Population growth, strong growth, goes with a shortage of housing supply. Population loss, even weak growth, goes with a glut of housing supply. Mix up the popular narrative and the peanut gallery will protest. The numbers are fudged to portray a preferred outcome. Population loss is bad. Population growth is good.

Population loss is good. Population growth is bad. The latter proclamation stands above controversy. Everyone knows too much of a good thing can kill you. Even in moderation: “This examination of the 100 largest metro areas, representing 66% of the total U.S. population, shows those that have fared the best have the lowest [population] growth rates,” writes Eben Fodor.

The economic metrics considered include income, unemployment, and poverty. Modestly, strong population growth is a poor predictor of strong economic outcomes. In fact, strong population growth in the United States is a strong predictor of poor economic outcomes.

Weak population loss or gain is good, a positive economic indicator. Strong population loss or gain is bad, a negative economic indicator. Buffalo is neither dying nor thriving. Success.